Financial services are the professional firms that manage money on behalf of individuals, businesses and government entities. They are the bridge that connects savers with borrowers, channeling cash into investments and redistributing risk. The more lubricated this channel is, the better it is for economic growth.
You might think of banks, mortgage lenders and brokers when you think about the financial services industry, but it’s actually much more expansive than that. In addition to those three major areas, the industry includes investment services, insurance, reinsurance and more. It also encompasses companies like Wall Street, private equity funds and venture capital providers.
Many people might be surprised to learn that a degree isn’t always necessary to get into the financial services industry. For example, there are a number of entry-level positions in credit analysis, underwriting and customer service that don’t require a degree. Moreover, the industry offers competitive salaries, especially when you are able to leverage your skills and experience in other sectors.
One of the biggest challenges for the financial services industry is keeping up with innovation and bringing it to customers. This is especially true in retail banking, where customers often lack the sophistication to understand complex products and services. Creating simpler, more user-friendly tools to help them save and manage their money is important for customer retention and new acquisition.
Another challenge is keeping up with changing regulatory and technological requirements. This is particularly challenging in global markets, where the regulatory environment and business practices vary significantly from country to country. Additionally, the rapid growth of technology has changed the way consumers interact with financial services, from traditional telephone and face-to-face to online and mobile. This has created a need for more innovative solutions that can integrate across channels and provide the best possible customer experience.
A key success factor for financial services is anticipating what their customers need at each stage of life. This requires a deep understanding of customer data to determine what products and services are most relevant. It also means being able to anticipate when customers may be considering milestone events, such as a marriage, moving out of state or buying a home.
Finally, financial services must also be able to respond quickly and effectively when disaster strikes. The September 11 attacks, hurricanes and other natural disasters have all required the industry to develop leading-edge solutions for recovery and continuity. This includes being able to operate in multiple geographic locations and using remote tertiary computing centers to avoid the need for costly relocations. The industry also maintains advanced security solutions to prevent cyberattacks and stay two steps ahead of attackers.